The Reserve Bank of India said it has imposed a penalty of Rs 50 lakh on The Urban Co-operative Bank Ltd No. 1758, Perinthalmanna in Kerala for non-compliance with directions on income recognition and asset classification norms, and on management of advances.
Statutory inspection of the bank with reference to its financial position as on March 31, 2019, conducted by RBI, revealed that the bank had not complied with the directions, the central bank said in a statement.
A notice was issued to the bank asking why penalty should not be imposed for non-compliance with the directions issued by RBI.
“After considering the bank’s written reply, RBI came to the conclusion that the charge of non-compliance with aforesaid RBI directions was substantiated and warranted imposition of monetary penalty,” the statement said.
The penalty has been imposed through an order dated December 11.
RBI also said that the action against the co-operative bank is based on deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers.